A federal commission that regulates dams is being asked to exempt a dam in Washington County from licensing requirements that could be costly to the paper mill that controls the dam and the surrounding community that benefits from the management of river and lake levels.

In a letter, U.S. Rep. Bruce Poliquin, R-2nd District, is urging the Federal Energy Regulatory Commission to exempt the Forest City Dam on the St. Croix River from regulations that could force its manager to abandon it. If the dam is abandoned, its gates would be open permanently and water levels on the river and in East Grand Lake would drop by 6 feet and have a deleterious effect on housing and fisheries that contribute to the area’s economy.

The commission regulates the interstate transmission and sale of electricity and natural gas and the transportation of oil by pipeline.

Poliquin argues that FERC licensing requirements and associated costs could upset the balance between protecting natural resources and creating good jobs in the Baileyville area Down East. He points out that in the past three years, the owner of Woodland Pulp, Hong Kong-based International Grand Investment Corp., which manages the dam, has invested over $150 million in new equipment and facilities to create St. Croix Tissue next to the pulp mill, adding nearly 80 new career jobs “in one of the most economically disadvantaged areas in America.”

“In 2015, FERC issued a new 30-year license that imposed enormous new costs to the mill,” Poliquin says in the letter, arguing that because of those costly regulations, the mill has begun the process of abandoning the dam.

“The millions of dollars in additional cost per year over the 30-year FERC license period could prevent further investment, growth, and jobs at the mill,” Poliquin wrote.

In late December, Woodland Pulp notified federal officials that it wanted to abandon ownership of the dams at Forest City and Sysladobsis Lake — both of which are in the St. Croix River watershed — because it has been operating them at a significant loss. Poliquin’s letter states the increased operational costs forced the owners to begin the process to abandon the dams.

“These abandonments could result in breeching the dams which, in turn, would lower the lake and river water levels by seven feet, thereby severely damaging the prized fisheries, fragile wildlife habitat, and valuable waterfront homes — killing hundreds of jobs in rural downeast Maine,” Poliquin wrote.

The Forest City dam controls water levels in East Grand Lake, which is Maine’s eighth-largest lake, at 16,000 acres, and straddles the border with New Brunswick. The other dam, a much smaller earthen dam at 250 feet wide and 9 feet tall, impounds the 5,400-acre Sysladobsis Lake.

The dams were built to regulate water levels feeding two hydroelectric dams farther downstream that power the Baileyville paper mill.

Poliquin is drafting legislation to exempt the Forest City Dam, along with two other dams, from FERC’s regulations. His letter also states that the agency has the discretion to exempt small, hydroelectric power projects with an installed capacity of 10,000 kilowatts or less on a case-by-case basis .

“I ask FERC to act as expeditiously as possible to exempt the Woodland mill from its licensing requirement,” Poliquin wrote.

Exempting the dam would protect thousands of sustainable jobs, Poliquin says, and “one of the most productive fisheries and wildlife habitats in America” will be preserved.

“In the end, our local families, untold generations of appreciative vacationers, and Maine’s pristine natural environment will all benefit for many years to come by FERC doing what is right — exempting the Woodland mill from the unnecessary, costly, and harmful licensing requirements,” Poliquin said.

Dozens of residents and camp owners have protested the permanent opening of the Forest City dam’s gates in filings with FERC. The Passamaquoddy Tribe, the province of New Brunswick and the U.S. National Marine Fisheries Service all have expressed concerns, the latter over how the opening of the gates would effect spawning fish runs. Local residents say the Thoroughfare, a passage connecting East Grand Lake and North Lake, could become impassable.

The Maine Department of Environmental Protection said in its letter to FERC that it was concerned about the likely effect on recreation, navigation, fish passage and aquatic habitat.

Even Canada has become involved, as the Forest City dam straddles the border and water levels on the St. Croix River are subject to international treaty requirements dating to 1909.

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